We are working to build hydrogen value chains optimized for each region. Our activity in Japan spans several demonstration projects for producing, transporting, and using hydrogen, including commercial hydrogen stations. Those projects provide us with a platform for identifying and addressing issues in regard to technology, regulations, operation, and economic viability. We look forward to translating our accumulated expertise into expanded business in hydrogen projects worldwide.
We are a member of the Toyota Group and participate in the group’s Environmental Challenge 2050 initiative. That initiative comprises measures for moving beyond zero environmental impact and achieving a positive net impact. Hydrogen will be a valuable tool in attaining that goal. And we will therefore take part in deploying carbon-free systems for producing and distributing hydrogen and for expanding the scope of hydrogen usage by promoting it in such applications as industrial vehicles, commercial vehicles, and electrical generation.
Fuel cell vehicles are the main market for hydrogen fuel in Japan. The price of hydrogen at Japanese fueling stations for vehicles is about ¥1,000 per kilogram. Hydrogen is thus comparable to gasoline as a vehicle fuel in regard to price per kilometer. And we foresee growth in fuel cell power for trucks, buses, and forklifts, as well as for passenger cars. Hydrogen is not yet price competitive, however, as a fuel for generating electricity. That is because it does not benefit from the government’s feed-in tariff program and other incentives that apply to biomass and other renewable energy sources.
I perceive in hydrogen immense potential for building carbon-free value chains adapted to needs and circumstances in each region. Building those value chains will present opportunities for structuring new business models around the world. As for Japan, our nation is lacking in fossil fuel resources, but we have ample potential for producing and using hydrogen. We can produce the hydrogen locally by electrolyzing water and reforming biogas with power from renewable sources.